Reference no: EM133127592
Question - Powder Keg Company's account balances on November 1 are as follows:
|
Debit
|
Credit
|
|
Debit
|
Credit
|
|
Cash
|
$7,800
|
|
Patents
|
$25,000
|
|
|
Accounts Receivable
|
12,530
|
|
Accounts Payable
|
|
$38,750
|
|
Allowance for Doubtful Accounts
|
|
$740
|
Notes Payable
|
|
2,400
|
|
Notes Receivable
|
6,000
|
|
Common Stock, no par
|
|
165,000
|
|
Inventory
|
25,121
|
|
Retained Earnings, January 1
|
|
24,958
|
|
Prepaid Insurance
|
840
|
|
Sales Revenue
|
|
36,833
|
|
Office Supplies
|
465
|
|
Cost of Goods Sold
|
32,000
|
|
|
Land
|
74,350
|
|
Sales Salaries Expense
|
6,200
|
|
|
Buildings
|
66,580
|
|
Office Salaries Expense
|
4,300
|
|
|
Accumulated Depreciation:
|
|
|
Advertising Expense
|
1,250
|
|
|
Buildings
|
|
21,400
|
Utilities Expense
|
1,845
|
|
|
Equipment
|
37,620
|
|
Interest Revenue
|
|
550
|
|
Accumulated Depreciation:
|
|
|
Interest Expense
|
210
|
|
|
Equipment
|
|
11,480
|
|
|
|
During the month of November, the following transactions took place:
Date Transaction
Nov. 2 Made cash sales of $3,400; the cost of the inventory sold was $2,040.
Nov. 3 Purchased $900 of inventory for cash.
Nov. 5 Sold an unused 1/2 acre of land for $4,000; the land had originally cost $3,650.
Nov. 8 Purchased a 2-year comprehensive insurance policy for $528.
Nov. 12 Leased an unused portion of its building to WebbCo, collecting 6 months' rent in advance at $220 per month.
Nov. 13 Made $2,300 of sales on credit to Lauren Company; the cost of the inventory sold was $1,400.
Nov. 16 Collected the $200 monthly payment plus $30 interest on a customer's note receivable.
Nov. 17 Purchased $1,600 of inventory on credit from Katy Company.
Nov. 20 Purchased land for a future building site. Made a $2,000 down payment and signed a 12%, 90-day, $6,000 note payable for the balance.
Nov. 23 Collected the Lauren Company account for the November 13 sale.
Nov. 26 Paid for the November 17 purchase of inventory.
Nov. 27 Paid the city newspaper $420 for advertising that had appeared during November.
Nov. 30 Paid $520 of sales salaries and $390 of office salaries.
Required - What the November 30 balance in the Retained Earnings account?
a. $15,986
b. $16,916
c. $24, 958
d. $33,000